Reason Foundation

Reason Foundation

Air Traffic Control Reform Newsletter #63

Topics include: GPS backup getting more attention; ATC user fees redux; steps toward "virtual towers;" ATC modernization progress in Europe; and other news.

Robert Poole
May 26, 2009

In this issue:

GPS Backup Issue Heating Up

In an ironic coincidence, the same day in May that the Government Accountability Office testified about its new report (GAO-09-325) warning of potential gaps in coverage by the GPS satellite-based positioning system, the Obama administration confirmed that it planned to cancel the officially approved backup system for GPS. The proposed budget zeroes out the legacy Loran-C, which the Coast Guard has been upgrading for several years into enhanced-Loran (eLoran), approved in early 2008 as the official backup system. What had been an obscure inside-the-beltway debate over GPS backup suddenly began receiving national attention.

The NextGen revamp of the ATC system depends critically on precise position and timing signals from the constellation of 24 GPS satellites. That's true of ADS-B, RNAV, RNP, and a number of other critical tools. Yet it's well-known that GPS is vulnerable to intentional and unintentional interference. Plus, as the GAO has now pointed out, because of delays in Air Force procurement and launch of its next generation of GPS satellites, there is a non-trivial risk that the number of functioning satellites could decline from the needed 24 to as few as 18 by 2017, then slowly build back to 24 by 2022. While that is a worst-case scenario, it is even more serious if there is no GPS backup in place.

After I last wrote about this issue, I got some flak from airline pilot readers telling me they already have backup capability, provided by triply-redundant on-board inertial navigation systems. Moreover, the FAA maintains a network of ground-based distance-measuring equipment (DME) stations that can assist planes not equipped with inertial nav.

That's true but irrelevant, for two reasons. First, the need for GPS backup extends far beyond aviation: it includes 911 emergency response location, cell phone timing, electronic financial transactions, freight logistics tracking systems, maritime navigation, and (oh, yes) national defense. And that's not counting numerous individual uses. Second, in terms of DME, that is one of the costly-to-maintain legacy systems that NextGen was supposed to permit phasing out; that's part of the business case for Next Gen.

These points were all addressed in a 2007 study commissioned jointly by the Departments of Transportation and Homeland Security to review the case for eLoran as the principal GPS backup. The Institute for Defense Analysis formed an Independent Assessment Team (IAT) for this purpose. They reviewed all prior studies on GPS backup, each of which considered only a single user-group's needs (such as aviation). Their conclusion: "The IAT unanimously recommends that the U.S. Government complete the eLoran upgrade and commit to eLoran as the national backup to GPS for 20 years." (italics in original)

That finding led to an announcement by the Department of Homeland Security on Feb. 7, 2008 stating that as of that date, "[DHS] will begin implementing an independent national positioning, navigation, and timing system that complements" GPS and that this system would be eLoran. But sometime between then and now, I'm told by a well-informed source, a group within the Office of Management & Budget, which has been aiming to de-fund Loran-C for many years, evidently persuaded their higher-ups to zero out Loran in the President's budget proposal, taking eLoran with it.

Everyone with a stake in GPS's ongoing viability should be speaking out and lobbying to reverse this decision. The amount of money is trivial; IAT's worst-case estimate of the cost is the current Coast Guard $37 million/year plus another $20 million/year for five to eight years to complete all upgrades, add new transmitters, and jump-start deferred maintenance. These costs should be split between DOT and DHS. You should read the IAT report yourself, to be well-armed for this debate. Until very recently, it was not available, but a Freedom of Information Act request succeeded in springing it loose, and you can find it at

» return to top

ATC User Fees: Back on the Agenda

"The Obama administration is proposing to cover most of air traffic control system costs with user fees, beginning in Fiscal 2011, a major change from the current excise tax-based system. [That] system generated $12.4 billion in 2008, and one scenario would see $9.6 billion collected in user fees in 2011. Generally, the administration wants funding linked more closely to costs, and costs ‘distributed more equitably.'"
--Aviation Daily, front page, May 11, 2009

Needless to say, I am pleased to see the new administration re-opening this debate. Besides summarizing several key arguments in favor of making this shift, I will also offer some suggestions on "getting to yes" among aviation stakeholders.

The most immediate reason for the aviation community to support this proposal is plummeting revenue for the Aviation Trust Fund, whose source is the "tried and true" aviation excise taxes staunchly defended by our friends in the general (AOPA) and business (NBAA) aviation communities. The big kahuna of those fees is the airline ticket tax. Thanks to decreasing air fares, the average domestic airline "yield" in March 2009 was 13.3 cents per revenue passenger mile—about 14% lower than March 2008. Since ticket tax revenue is a percentage of the ticket price, that equates to considerably less revenue from that source. Vaughn Cordle of Airline Forecasts LLC projects that total 2009 Trust Fund revenue (from all sources) will be lower than last year by 12.5%. The GAO, in testimony on March 10, presented a graph showing a seven-year decline in the Trust Fund's uncommitted balance, and warning that "in the longer run, co ntinued declines in Trust Fund revenue may require Congress to reduce spending on FAA operations and capital projects . . ." (GAO-09-435T).

An ATC funding system in which the revenue from fees closely tracked flight activity (rather than air fares) would be immune to the ups and downs of ticket prices. And on a longer-term basis, that stream of user-fee revenues could readily be bonded, to provide large sums of up-front money for major NextGen capital expenditures. Commercialized air navigation service providers (ANSPs) like DFS in Germany, NATS in the U.K., and Nav Canada all issue revenue bonds based on their user fee revenue streams, and all maintain investment-grade ratings. The Mineta Commission in 1997 recommended giving the ATO bonding authority, based on transaction-based user fees.

The Mineta Commission also explained that ATC fees like those used nearly everywhere else in the world would provide useful incentives for aircraft operators to make more efficient use of the airspace. For example, as Clint Oster and John Strong point out in their book Managing the Skies, under the current U.S. ticket tax system, for a 300-mile flight a 737-300 pays $777 for ATC, while a CRJ-200 regional jet pays only $267. Under Nav Canada's weight-distance user-fee system, the 737 would pay $674 while the CRJ would pay $319. Those would not be huge changes, but they could well make a difference at the margin, leading to some "up-gauging" by airlines (in which one 737 flight might replace several CRJ flights, reducing airspace congestion). The GAO has made the same point. The average number of airline seats per aircraft mile has been in a long decline since1982, and a shift to user fees might arrest th at trend, with positive consequences for congestion.

And transaction-based ATC fees could also help solve one of NextGen's toughest problems: getting aircraft owners to shell out for the needed on-board equipment to enable them to benefit sooner from NextGen (which will permit a lot of ground-based navigation aids to be phased out, resulting in longer-term cost savings). With an ATC fee system, it's feasible to give discounts for properly equipped aircraft, as overseas ANSPs are doing.

OK, you may say, those are legitimate benefits. But the reality is that AOPA and NBAA will fight tooth and nail to prevent such a change, as they always have (and are already doing thanks to the Obama budget announcement). How do we deal with that? I addressed that question in a dinner speech I gave in March at the FAA/NEXTOR NextGen workshop at Asilomar. It will appear late this month in the new issue of the Air Traffic Control Association's Journal of Air Traffic Control. ( The short version goes like this.

Transforming ATC funding should also mean transforming ATC governance—or as they said in Canada in bringing about the transformation to Nav Canada and the concomitant switch from ticket taxes to ATC fees—"user pay means user say." That means aviation customers, who would be expected to pay the fees, need to demand that they have a major say in the structuring of those fees and the uses of the revenue. That means a real board, with more than just advisory power, that fairly represents all customers—airlines of various types, business aviation, and general aviation.

Second, the restructuring needs to create genuinely win-win opportunities for all stakeholders. Because of the long, bitter history surrounding proposals for ATC fees, some hold-harmless principles would need to be set forth at the outset—such as no transaction-based fees for piston planes and an ability-to-pay formula for airlines and business jets, similar to the weight-distance formulas used by most ANSPs worldwide. Some kind of assistance with NextGen equipage could be part of the package, also.

I don't know if the administration realizes what it will take to make this happen, but if they are serious, this reform needs to have visible White House backing, so that Secretary LaHood and Administrator Babbitt can be seen as having marching orders to bring all the parties together to thrash out a workable proposal. As I said in my NEXTOR speech, this administration was elected on a platform of change. And ATC is one area that's desperately in need of change, not just in technology and procedures but also in governance and funding.

» return to top

Steps Toward the Virtual Tower

One of the key concepts being developed under the NextGen paradigm shift is the "virtual tower." What this means is that in the future, an airport that needs control tower services might not have to have a tall structure on-site, staffed with air traffic controllers. Instead, thanks to much-improved sensors and communications, those functions could be performed elsewhere, relying on visual and other data from the airport itself. Thus, relatively low-activity tower functions might be provided from one location for multiple smaller airports. Or all tower functions for the airports in a particular region could be co-located in that region's TRACON. Two recent developments suggest movement in those directions.

The first comes from Sweden, courtesy of the March 2009 issue of CANSO News. Swedish ANSP LFV that month carried out the first test of a virtual tower operation, directing the landing of a Swedish Coastguard aircraft at Angelholm airport from a control room at Malmo airport, 100 km. away. The technology, which involves nine high-resolution cameras at the remote airport (including one with zoom capability), was developed for LFV by Saab Group. A planned upgrade will enable the controller to track and label objects on the screen (in addition to having a panoramic visual display). This demonstration was the beginning of a three-year proof-of-concept project on the "remote tower" concept, as it is called in Sweden. LFV is particularly interested in this approach, since the country has a large number of isolated airports, which are costly to staff (and at which the controllers may feel isolated).

Closer to home, a step toward a virtual tower is under review by the FAA for the Aspen-Pitkin County Airport in Colorado. Because of its high altitude and short runway, on hot summer days, planes face weight restrictions that often mean they cannot carry a full passenger load. (In 2008, 11,774 seats could not be sold, due to such restrictions.) Hence, the airport is studying a runway extension, most likely of 1,000 feet. But its current 42-foot control tower is already not in compliance with today's FAA line-of-sight requirements. Building a tower high enough for the longer runway could mean a $20 million project for a tower up to 188 feet tall.

Or—possibly—it could mean equipping the runway with a camera system that permits operations to continue from the existing tower. An early-May story in the Aspen Daily News reported that an FAA decision is expected by June.

» return to top

Further Modernization Progress in Europe

While there is still a long way to go in creating a truly "single European sky" equipped with NextGen-type procedures and technology, tangible steps continue to be taken. Late in March, the European Parliament revised and then overwhelmingly adopted package II of the Single European Sky agenda. SES II consists of two sets of regulations, the first dealing with "performance and sustainability of the European aviation system" and the second on "aerodromes, air traffic management, and air navigation services." Among the changes made by the Parliament was to provide for a system coordinator for the Functional Airspace Blocks currently being negotiated among ANSPs and their governments. These new regulations are to be fully implemented by June 2012.

Early in May the 38 member countries of Eurocontrol took the very tangible step of committing €700 million (about $1 billion) to SESAR, the Single European Sky Air Traffic Management research effort. The SESAR Joint Undertaking consists of 16 organizations from both public and private sector—including Eurocontrol and the European Commission, a number of ANSPs, aerospace firms including Airbus, ground equipment makers such as Thales and Frequentis, avionics firms such as Honeywell, and representatives of European airports.

And progress is continuing on the Functional Airspace Blocks. On May 18th, the ANSPs of the U.K. and Ireland (NATS and IAA) published their three-year plan for the UK-Ireland FAB. It will be overseen by an FAB Management Board chaired jointly by the two ANSPs and including airline and military customers from both countries. Three working groups are addressing airspace design, service delivery, and safety. So far, 30 operationally based service improvements have been identified, half of which are to be implemented by the end of 2009.

The real test for the FABs will be whether there is serious consolidation of airspace and facilities independent of national borders. Only in this way can significant cost savings and productivity increases (e.g. air traffic movements per controller) be achieved. I'm a skeptic on this, but would love to be proven wrong.

» return to top

News Notes

Congratulations, Randy Babbitt. The FAA finally has its new Administrator, veteran pilot and aviation businessman Randy Babbitt. A Floridian, Babbitt was a long-time pilot for Eastern Airlines and eventually became president of the Air Line Pilots Association. He later founded Eclat Consulting, an aviation research and data firm that was acquired by Oliver Wyman in 2007. I've only met him once, when we both served on the advisory board overseeing a global study on ATC commercialization several years ago. He was also a member of the National Airline Commission (the "Baliles Commission") in 1993 and later of the FAA's Management Advisory Council. This background makes Babbitt highly qualified for his new position as FAA Administrator.

Challenge to Business Jets Community. My article in the March issue of this newsletter challenged the business aviation community to help repair its fat-cat image by supporting the $25/turbine IFR flight NextGen fee proposed by Sen. Rockefeller. Professional Pilot asked me to expand the idea into a two-page commentary, and the resulting piece appears in their May issue. (

Another Controller Contract Agreement. Airservices Australia and its controllers' union have reached agreement on a new three and a half year contract, ratified by 95% of the membership. The new contract provides for annual pay increases of 4.3%, accompanied by changes in sick leave and rostering arrangements aimed at increasing productivity. Airservices is the commercialized ANSP for Australia.

New Award to Nav Canada CEO. The Canadian Aeronautics and Space Institute (CASI) has announced the recipient of its 2009 C. D. Howe Award for achievements in planning, policymaking, and leadership in Canadian aeronautics and space activities. Nav Canada CEO John Crichton was selected for the award due to two achievements: (1) planning and developing commercial air routes in the Canadian north during the 1980s at First Air, and (2) the creation and growth of Canada's commercialized ANSP, Nav Canada. The award was presented at the CASI Senior Awards Gala Dinner on May 6, 2009.

CANSO Members Win Jane's Awards. Commercialized ANSPs garnered several honors in the Jane's ATC Global Awards, presented in Amsterdam on March 18, 2009. The Service Provision award went to the ASPIRE Partnership of Airservices Australia, Airways New Zealand, and the FAA, which is applying advanced technologies to reduce fuel burn and CO2 emissions on Pacific routes. Kazaeronavigatsia and Lockheed Martin won the Enabling Technology award for modernization of ATC in Kazakhstan. ANS CZ, Austro Control, HungaroControl, LPS, Slovenia Control, and the ANSPs of Bosnia-Herzegovina and Croatia won the Contribution to European ATM award for their work on the Functional Airspace Block for Central Europe. Associate (non-ANSP) members Boeing and QinetiQ Airport Technologies also won awards.

Risk-Based "Global Entry" Expands. In previous issues I have contrasted the TSA's Registered Traveler program with the Customs & Border Protection's Global Entry program. Both are open to people who submit data for a background check, and if passed, receive a biometrically encoded ID card allowing them speedier passage at airports. However, the TSA does not actually do a background check on RT applicants, which is why members must go through exactly the same passenger and baggage screening at airports as non-members. By contrast, CBP's Global Entry is a risk-based program, and those accepted can re-enter the United States from airline trips abroad (at participating airports) via quick-service kiosks, rather than waiting in long lines to show their passports to an Immigration official. And last month the U.S. government signed an agreement with The Netherlands to allow reciprocal privileges between Global Entry and the Dutch equivalent, called Privium. Since TSA and CBP are both under th e new leadership of the Department of Homeland Security, perhaps there's still hope to turn Registered Traveler into the kind of risk-based program it was originally intended to be.

» return to top

Quotable Quote

"Aircraft weight is seen as a simple means of approximating value of service. Airlines include value of service in their pricing. A ‘seat is not a seat' even in the same cabin on the same flight, although the airline cost per passenger is essentially the same. Prices can vary depending on time purchased, duration of stay, available ‘seat sales,' and so on. This is ‘yield management.' . . .So why is this so controversial for [ATC] service provision? It has long been crucial at ICAO to encourage countries to develop financially independent entities for [ATC], but some customers argue that since the cost does not change appreciably for the ANSP, all aircraft should pay the same fee, no matter the size of the aircraft. However, service providers worldwide treat cost recovery as meaning that in total, they recover all costs for a given service (e.g., en route and terminal). This is then distributed among users, most using the weight factor as a form of capturing the value of service, i.e., those who derive more value from a flight are asked to pay more."
--Glen McDougall, "Is a Blip Just a Blip?" The Controller, March 2009. (published by the International Federation of Air Traffic Controllers' Associations,

"The development and deployment of NextGen will require a series of incremental changes that must be demonstrated and tested to help ensure that they do not degrade the safety of current systems. Developing the evidence for regulatory bodies and for the public that these incremental changes are safe will be time-consuming, costly, and difficult."
--Gerald Dillingham, Director, Physical Infrastructure Issues, GAO, Responses to Questions for the Record, House Aviation Subcommittee, March 10, 2009.

"[Commercialization of Nav Canada] has had an enormous impact. We are in a much better position to respond quickly to evolving requirements and to support infrastructure enhancements by obtaining the appropriate financing, once viable business cases are made. We had some challenges in the early years, but now we're positioned to make effective change. Through a lot of hard work on the part of employees, we have created a results-driven structure."
--Rudy Keller, Vice President, Operations, Nav Canada, Direct Route, Spring 2009, p. 2.

"The recent trial environmental flights, AIRE and ASPIRE, across the North Atlantic and Pacific, respectively, are also examples of what can be done, and the savings in fuel and CO2 that can be made, using the existing technology. In addition to tailored departures and arrivals, the aircraft taking part in those trials were fed dynamic weather information, allowing them to alter their route to avoid bad weather and take advantage of winds. What is remarkable about that is the realization that this is not the case for all [airline] aircraft today. At the moment, aircraft routinely fly for 14 hours with more than 350 lives at stake with exactly the same weather information that you and I use to decide whether or not to take an umbrella when we go to work. And the information is about as up-to-date. But as the test flights have shown, that need not be the case. And it can be done today. Adopting these sorts o f changes will also have capacity implications. There is no reason to continue to use minima and separation standards from 1950. If we updated the standards to what aircraft can do now, we could significantly increase throughput."
--Andrew Charlton, "ANSPs at the Crossroads: Where to from Here?"Aviation Advocacy, April 2009

Robert Poole is Searle Freedom Trust Transportation Fellow and Director of Transportation Policy

Print This